Judy Martz on Technology

Former Republican MT Governor

Eliminate geography as a business issue, via E-Government

The new Research and Commercialization Board offers an excellent balance of scientific credentials and business sense, demonstrating that research is a state priority. 100% of the state now has local dial-up connection to the Internet. High-speed cable
modem and DSL services are being deployed not only in Montana’s large population centers but also in remote communities with populations of 1,000 people or less.

The Advanced Telecommunications Infrastructure Act passed in the last legislative session
has helped accelerate the growth of high-speed telecommunications infrastructure throughout the state. The tax credits issued under the Telecommunications Act will keep us in the forefront.

Elimination of geography as a business issue means
more and better jobs for Montanans statewide. With our new E-Government initiative, citizens will be able to dial up to find out about the expenditures of their tax dollars, register to vote, and obtain licenses and permits online.

Level playing field for Main Street vs. Internet sales tax.

Martz adopted a letter to Congress from 44 Governors:

The nation’s governors have a strong and unified message to Congress: deal fairly with Main Street retailers, consumers, and local governments. In a letter sent to all members of Congress late Friday, 44 governors said:

If you care about a level playing field for Main Street retail businesses and local control of states, local governments, and schools, extend the moratorium on taxing Internet access ONLY with authorization for the states to streamline and simplify the existing sales tax system. To do otherwise perpetuates a fundamental inequity and ignores a growing problem.

The current moratorium on Internet access taxes, like those consumers pay to Internet service providers, and multiple and discriminatory taxes is scheduled to expire in October. The moratorium does not apply to sales taxes.

Currently, sales and use taxes are owed on all online transactions, but states are prohibited from requiring “remote sellers” to collect and remit those levies.
A 1992 US Supreme Court decision said states can only require sellers that have a physical presence in the same state as the consumer to collect so-called use taxes. In instances when a seller does not have a physical presence, consumers are required to calculate and remit the taxes owed to their home states at the end of the year. The problem is most people are unaware that they’re supposed to pay, and states lack an effective enforcement mechanism. Online and catalog sellers, thereby, have a significant price advantage over Main Street businesses that must collect a sales tax on all transactions.

The loophole creates serious budget problems for schools, states, and local governments. A study estimated that states could lose as much as $14 billion by 2004 if they are unable to collect existing taxes on Web-based sales. Nearly half of state revenues come from sales taxes.